This is my version of Open Thread. It’s for posting random & miscellaneous observations in the comments section. Sometimes they are longer responses/questions related to an exchange or debate I’ve had elsewhere. Sometimes they are unfinished blogposts.

27 Responses to Random Notes

Based on the combination of aggregate growth trends and their accompanying patterns of structural change, the first part of the study suggested that three turning points separate the entire period after independence into four sequential phases of growth and structural change. These turning points are located respectively in the mid-1960s, 1980, and the mid-1990s. The period before 1980 was characterized by a relatively slower pace of aggregate growth than the one after, but at the same time was the period in which the industrial sector was more prominent in driving the process of growth and structural change in output. This was however a more pronounced feature of the phase from independence to the mid-1960s, after which the tendency lost steam. The period of accelerated growth after 1980 was accompanied by the replacement of industry by services as the sector playing the most prominent role. Initially however, it was the expansion of the public sector which chiefly underlay this increased importance of services in the process of growth and structural change. From the mid-1990s the services oriented trajectory was reinforced with the private organized sector decisively replacing the public sector as the driving force behind it.

Neither the paper nor I deny there was a change in trend, but it was less abrupt than you think, and the structural changes beneath the growth process are not fully explicable by the adoption of neoliberal policies, let alone “bourgeois dignity”.

“We begin with a summary table of both economy-wide and sectoral growth rates (Table 1). The growth rates in the table are non-overlapping five year averages of annual growth rates. The increase in the growth rate of total output in 1980-84, as compared to the 1970s is palpably clear from the table – the average annual growth rate in 1980-84 was 5.6 per cent as compared to 3.7 per cent in 1975-79. The increase in the economy-wide growth rate seems to be primarily due to an increase in agricultural growth and in the growth rate of registered manufacturing. However, this reading of average growth rates in the 1970s and early 1980s is misleading, as it does not take into account the fact that the Indian economy contracted significantly in 1979, due to the second oil price shock and due to a drought which was the worst since independence (Joshi and Little 1994). The growth rate of the economy in this year was a staggering negative 5.2 per cent – the highest drop in GDP that has happened in India since independence. If we exclude 1979 from our calculations, we find that the growth rate of the economy in 1975-1978 is a more respectable 6.0 per cent, not very different from the average growth rate of the economy in the 1980s!

“Our finding that the exclusion of the oil price shock/drought year of 1979 leads to a substantial revision of growth rate calculations since the mid-1970s is not a mere statistical curiosity. As we will see next, the exclusion of 1979 leads to a significant re- interpretation of the data used by RS and De Long which they adduce to make the point that the growth acceleration occurred in the 1980s. First, let us consider the summary figure used by RS to date the growth acceleration, which uses in part estimates of total factor productivity calculated by Bosworth, Collins and Virmani (2006) (Figure 1).ii

“It is clear from the figure that the increase in GDP per capita occurs from the mid-1970s, and not from the 1980s, once we exclude the outlier of 1979, the oil price shock/drought year. It is also clear that the increase in GDP per capita (or GDP per worker) parallels an increase in economy-wide total factor productivity (TFP) – in fact, the figure suggests that the primary proximate cause of India’s growth acceleration is not capital accumulation or labour force growth but an increase in the productivity of both capital and labour. The fact that the growth acceleration was primarily due to an increase in TFP is itself a reason to be sceptical of the ‘attitudinal shift’ argument. During the second half of the 1970s, there were no significant changes in the industrial licensing regime or a easing of restrictions on foreign direct investment that would allow firms to reap economies of scale by expanding or to increase their absorption of technology from abroad.”

Form beef into hamburger patties. Melt tallow over heat (preferably in a deep LeCreuset). Deep-fry patties in melted tallow. Throw out patties. Strain oil & place in container & refrigerate. Repeat following day and every day for 1 year, or when your block of tallow + drippings achieve the colour of dark chocolate.

When I saw the photo my first thought ran to “Institution for sale of Taiwan to Chinese [something]”. But from what I gather the top set of characters is a clever play on the characters for Kuomintang. Although I recognise the 2nd character of the top row I personally think the simplified form 中国 is much better than 中國, but country names just like people’s names have their own pecularities and traditions. I’m sympathetic to traditional characters in many cases, because some simplified characters as used in China are odd beyond belief. 厂 for factory ? Like so many of the extreme-simplifications it looks like a decapitation or a stroke come to life, rather than a character in its own right. On the other hand the simplified form 党 just seems so much better, so much more streamlined than that ancient mess on the right of the top row…. If 党 had been used I probably would have guessed the pun in the top row. The second row….Mair says it’s a pun on Taiwan’s legislature. The joke is impossible to get without knowing the particular characters used in Taiwan for the particular designation of the Taiwanese legislature. All I could gather was “Taiwan sale institution”. Of course the immediate resonance of a pun is just not there, after an explanation. My question is, would the Chinese in China get the joke ? And if they did get it after some thought, would it then resonate less as a pun for them than for Taiwanese ?

Ben Southwood’s summary: “People living [today] in areas just inside the Hapsburg empire still have higher generalised trust than those living in areas just outside”.

Slightly gorier details:

The modern states of Montenegro, Poland, Romania, Serbia, and Ukraine contain formerly Hapsburg territories. There is more trust in police and courts inside those territories today than in the adjacent areas just outside the Hapsburg boundary but within the same countries.

In those five countries, individuals and businesses located within the 75-100km band just inside the boundary report (a) trusting the police and the courts more…; and (b) considering it less necessary to bribe public officials…; than individuals and businesses located within the 75-100km band just outside the same boundary.

However, there is no statistically significant discontinuity at the border in terms of interpersonal trust or social capital (participation in civic life). This is a key point.

(1) The “Hapsburg effect” on institutional trust does not appear to be an artefact of preexisting characteristics of the populations/territories prior to their incorporation into the Hapsburg empire. There is little difference in altitude between adjacent Hapsburg and non-Hapsburg areas of the same countries. The areas just inside the boundary were no more urbanised in 1000-1500 or open to foreign trade in 1450 than the areas just outside the boundary. If the old “Saxon” settlement areas in the present-day Romania had been more developed in the Middle Ages than the non-Saxon areas, this should be captured by the urban and trade effects.

(2) The H. effect is not reflecting some dichotomy or cline between “West Slav” versus “East/South Slav”. The overall effect is not driven by the inclusion in the sample of two provinces now in Poland — Silesia, one of the longest-held possessions of the Hapsburgs (>200 years) — and West Galicia. When the hyper-West-Slavic Silesia is dropped from the sample, the H. effect increases. Likewise with Galicia.

(3) Nor is the H. effect reflecting some kind of east-west gradient in omitted variables. When the Hapsburg boundary is artificially “moved” east or west by 100km, the pseudo-border causes the effect to disappear or lose statistical significance.

(4) The Hapsburg sample contains somewhat more ethnic minorities than the non-Hapsburg (mostly from within Romania). But this biases the results against the H. effect, because ethnic minority status is negatively correlated with trust in institutions.

One of the dumbest objections to the paper is to suppose that the H. effect may be mediated by the persistence of Hapsburg administrative practises within the H. areas but, for some reason, not outside the H. areas within the same countries. For example, police officers or court judges in a given region “may” be chosen from another region, in order to avoid local conflicts-of-interest. Of course there is no evidence this happens in any of the five countries, but the idea is quite absurd regardless. It would imply that Poland or Romania or Serbia would puzzingly maintain different public employment practises in H. and non-H. regions.

At school I was required to do Latin composition. We had to originate several short passages a week. We were told to model our scribblings as much as possible on the heroic literature of Rome’s Golden & Silver ages, some of which were implausibly stilted and nauseatingly glorious. As psychic compensation for such deadly earnest and gravitas, many of us wrote pseudo-Ovidian pieces like this one the only I can still remember verbatim :

Once, as a young officer, Caesar, as punishment for womanly behaviour, was sent down to the farm of his commander’s freedmen that he might search for a lost cow and, when found, to drag it back by the tail. Captivated by the sweet and sympathetic face of the heifer, he realized afterwards that he preferred heifers to bulls. Caesar was always grateful to her, who had shown him the righteous path and had urged him to never to feel shame for his fondness for oxen. Thus, for the rest of his life Caesar was often seen proudly and eagerly wandering the fields in search of her kind.

As someone who is keenly interested in the phenomenon of ethnic conflict, what has always struck me about the West is not that it lacks ethnic conflicts, but that it is unusual for harbouring a large population of anti-nationalists. That is, in North America, Australia, Papua New Zealand, and Western Europe there is a large proportion of the population, usually on the left, who rejects their country’s national myths, who regularly criticises their country’s internal and external behaviour, who find as much to be ashamed of in their past as to be proud of, and who basically finds patriotism a dirty feeling.

I remember vividly at the onset of the Second Chechen War, the spokesman for the Russian Foreign Ministry, in livid frustration at the sceptical, probing questions fielded by western journalists, lashed out at the journalist from Libération, the flagship of left-wing French journalism, and uttered something like “You French committed all kinds of crimes during the Algerian war, why are you on such a high horse now?” And the next day, Libération had an editorial leader in reply, which said, in essence: “Mr ___, you are absolutely right, France behaved criminally and shamefully during the Algerian War, and Libération is proud to have been an open and vocal collaborator with the Algerians in ejecting France from Algeria”.

Everywhere in the former Soviet Union I have noticed that — unlike Western Europeans, North Americans, and Australasians — Russians show no remorse for, or even display evidence that they were aware of, the multitude of sins their ancestors had committed in their history of imperial expansion.

Russians are proud of their bloody conquest of the Caucasus; they do not rue the quasi-genocidal forced sedentarisation of Central Asians, instead they boast that they civilised and enlightened the buggers; and if they are even aware that their imperial expansion into Siberia resulted in as many horrors for the aboriginals of Siberia as the colonisation of the Americas and Australia had resulted for those aboriginals, then the Russians might respond, at least we gave those indigenous people writing.

Even if there are people in the West who think like the above, few in the UK or France or Germany or Australia would ever actually say anything like that. A large proportion of the population would more likely be citing the litany of crimes their countries had committed in the past. Most Australians and New Zealanders are tiresomely repentant about how nasty their ancestors had been to the aboriginals. At least as many Britons are likely to believe that Britain exploited and deindustrialised India into wrenching poverty as did any good for it. Germans have been immobilised into a kind of pathological navel-gazing docility over their war guilt, as though never again will they allow themselves normal feelings of love of country (except during football matches).

In essence, the West is post-nationalist.

There are three countries stuck somewhere between nationalism and post-nationalism: Israel, Japan and India.

Despite the vastitude of nationalist myths that surround its founding, and the ethnic conflict with the Arabs which is deafeningly full of the same prejudices, myths, and delusions as those found in all other ethnic conflicts, Israel is still distinguished by the presence of an anti-nationalist left, including a large group of historians who reject the Zionist foundation narrative and adopt the Arab narrative about the founding of Israel. (Needless to say, the equivalent — adoption of the Zionist narrative — in the Arab countries is totally inconceivable at this stage.)

Official Japan is thoroughly nationalist. Its educational system has literally whitewashed its WW2 history. There are references to “misfortunes” and “incidents” in school textbooks, but few Japanese have an inkling about the extent of its criminal recent history. Not the biological experiments in Manchuria, not the conscription of millions of “comfort women”, not the Rape of Nanking, etc. But Japan too has a left-wing academia who despises the official nationalist myths and has tried hard, despite the threats from the right-wing extremists, to open up education & public discussion about the war.

India too has a small post-nationalist class. The anglophone “secular progressives” are the politically correct, mostly anglophone and upper-caste, Indians who are despised by the Hindu nationalists. Secular progressives are regarded as hating everything Hindu, loving everything Muslim, loving everything Marxist, hating everything Indian, adopting neocolonialist perspectives, etc. But these constitute a small class, and probably dwindling.

No other country qualifies as post-nationalist or verging on post-nationalism, in my opinion. Not Turkey, not Greece, not Russia, not Poland, not China or Taiwan, not South Korea, not any country in Eastern Europe or Latin America. In fact, China finds itself in a rabidly nationalist phase, and I think India is going backward and entering its own hyper-nationalist phase.

You have left-wingers in a country like Turkey, of course, but Turks, left and right, line up in depressing unanimity on the key negative issues which define Turkish nationalism: the rivalry with Greece, the denial of the Armenian genocide, and the sentimental concern for the remnants of empire (Muslims in the Balkans). You won’t find a Turk, in Turkey or elsewhere, conceding that just maybe, just maybe, the Ottoman Empire did commit genocide against the Armenians; nor is there any Armenian, either in thoroughly nationalist Armenia or in the hyper-nationalist diaspora, who would concede that just maybe the Armenians in the Ottoman empire hadn’t been as innocent as the Jews were in the Second World War. Pretty much the same story in Greece. Greece must be the only “western” country whose mainstream left cheered on the Bosnian Serbs entering Srebrenica, which was covered like a football match in Greece.

Nationalist countries have populations who are almost unanimously attuned to group self-defensiveness, demonisation of group enemies, propagating myths of national victimisation, and creating myths which boost collective self-esteem.

Post-nationalist countries do have such elements, but only in competition with the anti-nationalists.

By the way, is it possible that a modest dose of post-nationalism is actually a very good thing? The post-nationalist counties you mention maybe more pleasant places to live for all kinds of subcultures for example. Though I hasten to add that I think postmarxist-postmodern intellectual trends in these countries may end up being a civilization-destroying machine..

In modern English, would/should/might do not express the past tense of the indicative mood, but the present tense of the subjunctive mood. The past tense of the subjunctive would be “would/should/might have [participle]”.

There is one exception, which is a remnant of Old English verb usage in Modern English: sometimes ‘would’ is used as an auxiliary verb expressing an habitual condition in the past.

“When I lived in the Seychelles, I used to chase the native girls all day”.

“When I lived in the Seychelles, I would chase the native girls all day”.

These two sentences mean the same thing.

If you have ever noticed that many non-native speakers of English use the form “…was chasing…” when they should be using “would chase” or “used to chase”, that’s because the mavens of prescriptive grammar in English have put inappropriate foreign labels on categories of English, such as ‘imperfect tense’, which refer specifically to habitual past states in the Romance languages but is really quite meaningless in English, which never had unique forms to express imperfect tense meanings.

English has a third way of expressing a habitual past condition, which is simply:

“When I lived in the Seychelles, I chased the native girls all day [all the time]”.

This has an imperfect meaning, roughly equivalent to ‘would chase’ or ‘used to chase’ but the form is often called ‘past tense’ or ‘simple past tense’ or even ‘preterite’, in a preposterous emulation of the labels found in Romance languages. Because incommensurate labels of grammar in different languages are forced to match by prescriptivist pedogogues, generations of students of Romance and Germanic languages in the English-speaking countries and students of English in the Romance- and German-speaking countries have been misled by the labels. A preterite in Spanish behaves differently from the ‘preterite’ in English.

This is a deconstruction of two articles related to Richard Dawkins by Carles Sirera, a history professor at the University of Valencia in Spain. I will post it here in the “Random Notes” (open) thread, rather than as blogposts, because I don’t think too many people will be interested.

Sirera specialises in hating neoclassical economics, political science, modernisation theory, and the neo-Darwinian synthesis in evolutionary biology. Outside of his academic writings, he spends his time writing one screed after another denouncing “economic imperialism”. Unfortunately for Sirera, either he has never read the works he criticises; or he just doesn’t understand them. If you thought Jo Guldi was a professional connoisseur of the hallucinated subtext, then she has met her match !

This first post concentrates on Dr Sirera’s “analysis” of the views of Richard Dawkins, as contained in the following article and blogpost :

There is not one sentence which is true in the above. Not one sentence. Both of the above exemplify Sirera’s idiosyncratic combination of infantile incomprehension, solipsistic masturbation, and malicious misrepresentation.

100% false. It is false both (1) in the sense that Dawkins never said any such thing; and (2) in the sense that none of Sirera’s sentences is even a logical implication of anything Dawkins said.

Sirera confuses the “selfish gene” with the “selfish individual”. This is an elementary error. The distinction between the gene and the organism as the unit of selection in evolution is fundamentalto mainstream evolutionary biology. Dawkins did not even originate the gene-centred view of evolution. He merely popularised it in The Selfish Gene and other books.

One of the most important arguments of the gene-centric view is that altruism and cooperation cannot be explained by individual or organismal selection. The discussion of altruistic behaviour pervades the book. None of it would make any sense if the “selfish gene” = “selfish individual” !!!

Dawkins has a whole theory of culture. And his theory is based on how ideas spread between individuals and become socially shared. His later book, The Extended Phenotype, also (partly) presents a theory of culture. Sirera can argue this is a bad theory of culture — I myself think it’s a very bad theory — but it cannot be denied that Dawkins does have a theory of culture. (Sirera also fucks up Wittgenstein. The ball example was not about culture !)

Sorry, but Professor Zamora is correct. Although I myself completely reject Gould, it is possible, in principle, to accept a little bit of Gould and a little bit of Dawkins.

Sirera has repeatedly claimed that his critique of Dawkins mirrors the views contained in Gould’s famous essay “Darwinian Fundamentalism“. But that claim is also FALSE.

Gould’s essay does not attack Dawkins’s “selfish gene” concept per se. Gould attacks a higher-category idea and a whole class of evolutionary biologists — the idea that natural selection is the exclusive mechanism of evolution, which is held by those whom Gould calls “ultra-Darwinists”. Here is Gould himself :

A movement of strict constructionism, a self-styled form of Darwinian fundamentalism, has risen to some prominence in a variety of fields, from the English biological heartland of John Maynard Smith to the uncompromising ideology (albeit in graceful prose) of his compatriot Richard Dawkins, to the equally narrow and more ponderous writing of the American philosopher Daniel Dennett…

Amid the variety of their subject matter, the ultra-Darwinists share a conviction that natural selection regulates everything of any importance in evolution, and that adaptation emerges as a universal result and ultimate test of selection’s ubiquity.

…Darwin himself strongly opposed the ultras of his own day….

Gould rejects “ultra-Darwinism” because he is a pluralist about the causes of biological evolution, without ruling out natural selection :

…the invigoration of modern evolutionary biology with exciting nonselectionist and nonadaptationist data from the three central disciplines of population genetics, developmental biology, and paleontology (see examples below) makes our pre-millennial decade an especially unpropitious time for Darwinian fundamentalism—and seems only to reconfirm Darwin’s own eminently sensible pluralism.

Natural selection, an immensely powerful idea with radical philosophical implications, is surely a major cause of evolution, as validated in theory and demonstrated by countless experiments. But is natural selection as ubiquitous and effectively exclusive as the ultras propose?

So how would Professor Zamora go about integrating a little bit of Gould and a little bit of Dawkins ? Well, for example, you can accept the concept of the extended phenotype, while at the same time reserving a place for genetic drift as one of the alternative causes of evolution.

Science does have a culture, science is social, and science does have institutional authority. However, scientific theory is also an object not restricted to a single text. Its parts can be detached and rearranged, or parts of different wholes can be put together. Sirera’s problem is triple: (1) he does not understand basic scientific concepts; (2) by axiom he rejects scientific “authority”, so he treats scientific theory as dogma; therefore (3) he treats scientific theory as fixed in one location or one text which can be referenced either as “Gould” or as “Dawkins”, but the two sets (in his mind) never intersect.

Wrong !!! The social utility of palaeontology has nothing to do with it. Gould’s theory (punctuated equilibrium) concerns macroevolutionary speciation, which cannot be tested directly or easily because it happens over millions of years. [Edit: more precisely, Gould’s theory is about species stasis or “stagnation” over millions of years.]. The selfish gene concept, by contrast, is inherently microevolutionary and can be observed in principle.

Sirera has many times also argued, his critique of Dawkins is consistent with Gray’s criticism of Dawkins’s atheism and radical materialist-empiricism. FALSE. In that article, Gray does not attack the selfish-gene concept; does not criticise even the adaptationist paradigm criticised by Gould; and does not share his opinions about the “Darwin Wars” between the camp of Gould and the camp of the “ultra-Darwinists” like Dawkins.

When Gray finally mentions the book The Selfish Gene, he is completely silent about the selfish gene concept. Rather, he criticises the meme concept — Dawkins’s theory of culture, which Sirera had already denied even exists !

The larger problem is that a meme-based Darwinian account of religion is at odds with Dawkins’s assault on religion as a type of intellectual error. If Darwinian evolution applies to religion, then religion must have some evolutionary value. But in that case there is a tension between naturalism (the study of humans and other animals as organisms in the natural world) and the rationalist belief that the human mind can rid itself of error and illusion through a process of critical reasoning.

There are several evolutionarytheories of religion. All of them imply that while individual religions are products of culture, religiosity is a natural biological phenomenon in humans. Gray is saying, in effect, if religion is a product of evolution, then Dawkins’s claim that religiosity can be eradicated is hopeless:

Part of that truth may prove to be that humans are not and can never be rational animals. Religion may be an illusion, but that does not mean science can dispel it. On the contrary, science may well show that religion cannot be eradicated from the human mind. Unsurprisingly, this is a possibility that Dawkins never explores.

Gray also criticises Dawkins’s radical empiricism and materialism, which is self-defeating because a “purely naturalistic philosophy cannot account for the knowledge that we believe we possess”. I agree completely with Gray that Dawkins’s atheism is theological, his view of religion is incoherent, and he substitutes scientism as a new religion.

the “selfish gene” concept is theological and non-falsifiable [WRONG: Gray’s indictment of Dawkins’s leaves untouched the selfish gene concept. Not even Gould’s Darwinian Fundamentalism talks about the selfish gene !]

the “selfish gene” = “selfish individual” [WRONG: this equivalence cannot be found in Gray nor in the Gould essay nor anywhere else, because everybody except Sirera has learnt not to make this mistake !]

in Dawkins there is no space for culture [WRONG: Dawkins has a famous theory of culture !]

EDIT : Sirera has responded to me. He says “[he] even correcting my wrong use of Spanish”… Where did I do that ?

L’anomalie espagnole

Why is the title in French ? I don’t know. It just sounded more like an opera.

With the possible exception of Australian aborigines, very few people find the Spanish language particularly strange. In fact, it has a reputation for being fairly “normal” and well-behaved. If you speak a Western Eurasian language, chances are, you don’t find Spanish exotic or difficult.

But there are some features about Spanish grammar which are extremely peculiar, even bizarre.

The following bizarreries, as far as I know, are unique to Spanish.

Bizarre use of the preposition “a”

In Spanish the single-letter word a would usually be translated in English as to, the preposition most often accompanying the indirect object or dative case of the noun, such as I sent the letter to the laywer. In French the equivalent would be à and in German zu.

But in Spanish a frequently shows up in situations where it “should” not, from the point of view of most other languages. For example, in front of direct objects which are people or pets. In English, you say, I love my wife ; in French, j’aime ma femme ; and in German, iche liebe meine Frau.

In Spanish you don’t say, quiero mi mujer. Rather, you say, quiero a mi mujer — or in word-for-word literal translation, I love to my wife. But there is no indirect object meaning embedded in the Spanish sentence. The preposition just sits there, in glorious redundancy, with no apparent reason.

Conoces a mi amigo ?

Do you know (to) my friend ?

Acabo de ver al doctor

I just saw (to) the doctor

(Of course, there are numerous exceptions to the above rule, which I will not go into.)

BUT when you replace the noun with a pronoun, you don’t use le, the equivalent of to him or to her. You use the simple direct object (accusative) pronoun lo or la.

Lo vi — I saw him

BUT BUT the so-called “leísmo” of Spain allows you to say :

Le vi — I saw (to) him

The relative pronouns like “who” and “which” also take the a / to when replacing the noun referring to people or pets.

el acusado a quien el juez ha condenado

the accused (to) whom the judge condemned

Bizarre redundancies and substitutions

Even when the preposition a is used “normally” in an indirect object (dative) sense, still stranger things happen in Spanish.

Even when you name the person to whom you are performing an action, a redundant pronoun is used in Spanish :

Le envío a Miguel una carta

I [to him] send a letter to Miguel

This is very strange ! But even stranger is: when you say “I send it to him”, you no longer use the word “le”. Instead you substitute the pronoun “se” which in most other contexts has the reflexive meaning “to himself” :

Se la envío

I send it to him[self]

Very strange ! This is supposedly done to avoid the unpleasant sound combination “le la”. But of course such combinations occur in some of the other Romance languages: “je la lui envoie” in French or “gliela mando” in Italian (g is silent).

It’s 24 December and an Israeli border guard sees somebody coming. It turns out to be a Palestinian man and his pregnant wife riding a donkey. He stops them with machine gun in hand and asks where they are going.

“To Bethlehem”, the man says.

“Why to Bethlehem?”

“Because my wife is having a baby”.

“What hotel are you staying at?”

“We couldn’t get a hotel, we’re going to have to stay in a friend’s stable”.

Amazed, the guard asks, “What’s your name?”

“Joseph”.

“And your wife?”

“Mary”.

“Incredible”, says the sentry, “Christmas Eve, Bethlehem, the donkey, the stable, Joseph, and Mary… I suppose you’re going to name the child Jesus?”

99% of humanist criticisms of, objections to, reservations about, or misunderstandings of, statistical social science are reducible to something as simple as the following :

Given y = F(x1,x2,x3….) we are (not always but frequently) only interested in estimating β1 for x1. But many people mistake this for monocausal reasoning, i.e., as though finding an estimate for β1 were equivalent to the assertion that r2=1

Sowell’s Affirmative Action Around the World: An Empirical Study attempts to demonstrate that in a group of countries so diverse, with such different cultures and historical experiences, there are nonetheless striking commonalities in the practise of preferential policies which can be synthesised into a universal critique. My problem is simply this: most of the preferential systems he cites are not comparable with affirmative action in America.

Affirmative action in the USA and the Indian (central) government’s reservations system (for low castes and backward tribes) are directly comparable in that both are preferential policies intended as redress for past inequities against marginalised groups. But this sort of ‘compensatory’ preferences are altogether a different animal from the preferential policies implemented in Sri Lanka, the Nigerian provinces, and India’s linguistic states (such as the three ‘ Maharashtra, Assam and Andhra Pradesh — that Sowell talks about). Preferences in these places are an element of a larger programme of nativist hegemony or exclusivism, in which members of an ethnolinguistic, tribal or religious group claiming to be indigenous to a particular area demand that their own kind, the ‘sons of the soil’, be the ones to staff their governments and control their economies, while demoting ‘outsider’ groups to secondary status or even excluding them altogether. Because most of these societies have yet to achieve a civic concept of nationhood, the cry for the empowerment of the ‘sons of the soil’ is much less like affirmative action in the USA, than like natives’ complaints about immigrants taking away their jobs or about the demands for bilingual accomodation by immigrants and their advocates, as one sees in the developed countries.

Since ‘natives first’ demands take precedence over other possible effects of preferential policies, it’s irrelevant that chauvinistic quotas may reduce the incentives to excel or may exacerbate intergroup tensions. Surely it’s misplaced to inveigh that preferences tend to benefit the most fortunate amongst the preferred (as opposed to the poor), if most of the preferred groups discussed in the book only care about the ethnicity (or other group affiliation) of the beneficiaries. Likewise, it’s beside the point to argue that preferential policies promote intergroup hostility if chauvinism and exclusivism are the motives behind those policies to begin with.

Nigeria at the federal level (as opposed to the provincial one) is incomparable with the USA in a different way. Because there is no single dominant group but the country has such a wealth of natural resources (oil amongst other things), regional groups vie in a sectionalist or distributive conflict over control of the central government and the shares of the country’s spoils. Nigeria is a poster child of the hyperheterogeneous fragmented Third World country. In developing countries, heterogeneity is associated: (a) with higher levels of inefficient redistribution (i.e., resources from one group are diverted by politicians of another group as patronage to their own); (b) with lower levels of public goods provision at the national level (because groups don’t want to help pay for goods which other groups can also enjoy, or in econospeak, the utility a person derives from a given public good is reduced when other groups get to use it also); and (c) with higher levels of regional public goods (i.e., ‘pork’ in American parlance). Again, this is much less like affirmative action in America than like the patronage systems of big American cities in the late 19th and early 20th centuries, when immigrant groups — Irish, Italians, Poles, Jews and others — practised ‘ethnic nepotism’ and competed with one another to secure for their own kind a large share of the city’s loot (usually municipal jobs, but also construction money etc.).

Malaysia is an intermediate case, because its government did actually care about things like ethnic resentments and economic efficiency. But the majority Malays’ sense that Malaysia belonged to them and that they, not the Chinese ‘foreigners’, should control their country’s economy was still a powerful driver of the New Economic Policy. Even Sowell quotes from Mahathair to illustrate his sense of wounded pride that his native ‘race’ has been so comprehensively outperformed by the ‘alien’ Chinese, even with the pro-Malay preferences.

There is some evidence in each of the country chapters that Sowell recognises the above qualifications, but this only makes his book all the more puzzling. It’s as though in examining specific countries, he acknowledges the things that make the comparisons inappropriate, but he goes ahead with the comparisons anyway when ever he is summarising his major points. For example, on pp 180-82, he compares India’s Shiv Sena — a quasi-fascist Hindu ultranationalist organisation responsible for the Bombay riots of 1992-3 in which its activists doused thousands of ordinary Muslims with petrol and burnt them alive — with the black civil rights movement in the USA.

Ultimately, comparisons like this make me believe Sowell’s chapters on India, Nigeria, Sri Lanka, and Malaysia are not really about India, Nigeria, Sri Lanka, and Malaysia. Rather they come across more as a polemicist’s ploy to stigmatise his parochial target (affirmative action in the USA) by associating it with some of the truly appalling things that occur in his comparator countries.

Sowell litters the book (but especially its conclusion) with sardonic and indignant comments about the self-righteousness of do-gooders and how (in effect) the road to hell is paved with good intentions. But most of the time the indignation is completely inapposite, because so many of the preferential systems he studies are implemented by people or groups who aren’t even pretending to do good. I find it silly and pathetic that a man as learn’d as Sowell should frequently hold forth as though Yoruba tribal chiefs or Shiv Sena’s party hack-thugs had the same motives as liberal multi-culty presidents of Ivy League universities babbling about intergroup harmony.

But it’s not ignorance or stupidity on Sowell’s part. He’s acting out his need to confront his daemonic obsessions: those ‘anointed’ liberals in high places.

AAAW’s primary flaw is in the wisdom and coherence of the overall comparison. But the book can also be judged on Sowell’s analyses of the countries in the individual chapters. Some chapters merely amplify the general flaw; other chapters contain serious distortions that go well beyond it.

Of all the chapters, I would say the one on Malaysia is the most reasonable ‘ although there are numerous cavils I would make over Sowell’s reading of the Malaysian experience. The chapter on the USA is not bad either, except that it suffers from a distortion which almost all discussions of affirmative action in America suffer from, viz., an excessive focus on racial preferments in admissions at elite universities, something which affects a tiny proportion of the racial minority population in the USA. One would think the biggest potential impact that affirmative action might have had on American blacks is public sector employment, both at federal and local levels; which is often said to have helped create the black middle class. (Sowell does address black poverty and affirmative action, which is not the same thing.)

The chapter on India is mixed. The subsections on Maharashtra and Andhra Pradesh frequently misrepresent what happened or omit key details, while the one on Assam merely suffers from the book’s general flaw. The analysis of the central government’s reservations system is quite reasonable, except for the muted implication that it has somehow fostered caste and other kinds of violence.

The one chapter in the book that stands out for its sheer awfulness is the one on Sri Lanka. It is simply a travesty, an egregious and grotesque distortion, with apparently no reason for being other than to insinuate that affirmative action led to civil war! I want to be clear about this. Although Sowell is relatively cautious in his Nigeria chapter while discussing the complex causes of ethnic violence and war in that country, on Sri Lanka he’s pretty straightforward and there is no doubt the impression an uninformed or gullible reader would take away from his narrative: ‘With all the lives that it has claimed, what did affirmative action accomplish in Sri Lanka?’ (pp 91-91, with similar remarks in pp 187-8 and 196-7). The Sri Lanka chapter does not even bother addressing most of the other key points Sowell believes his ’empirical study’ establishes. So Sri Lanka is apparently included solely to advance his claim that affirmative action in this case led to civil war.

Even on Sri Lanka he makes caveats everywhere, but then draws conclusions which those caveats preclude. Or sometimes he asserts things in a mealy-mouthed, muted way which could allow him to say he didn’t say that. For example, pp 26 “This escalation of [caste] violence has been associated with backlashes against the official preferences given to untouchables…..[etc.]”. He doesn’t mention that this ‘association’ is found in a study which also found that caste violence is overwhelmingly concentrated in the Hindi-speaking ‘cow belt’ states of the north. I can’t find it now but there is a footnote buried somewhere where, if I recall correctly, Sowell even lists those particular states where the problem is egregious. Yet India’s reservations system is applied nation-wide, not just in the north. This Sowell knows quite well, yet he has no compunction about leaving the reader (especially those who don’t root around in the footnotes like a pig searching for truffles) with the unqualified impression that caste violence is general and is attributable to the reservations system.

Sowell’s Sri Lanka narrative is skewed to isolate, emphasise and magnify the role of ethnic preferences played in the conflict between the ruling Sinhalese majority (the beneficiaries of preferments) and the Tamil minority. But preferential policies are just not the all-encompassing part of the story in Sri Lanka that Sowell is hell-bent on making it out to be. Preferences were simply one, possibly even a minor, element of a larger multifaceted erosion of Tamil rights intended to impose a Sinhalese hegemony over the entire island.

It’s almost as though, since Sowell can’t rigourously substantiate the claim that affirmative action harms racial relations in the USA, he outsources the job of implying such a link to the ethnic riots and carnage of developing countries.

No chapter is as egregiously distorted as the one on Sri Lanka. Still, there are smaller distortions, highly questionable judgements and outright preposterous howler-type statements generously sprinkled throughout the book. (I marked it in pencil each time I read one.) I mean, there is just one after another. An example: Sowell suggests, in very quick passing, that East Pakistan’s (i.e., today’s Bangladesh) revolt against West Pakistan was somehow related to preferential policies in favour of the Bengalis!!! (Believe me, this is as stupid a statement as saying that the North fought the South to perpetuate slavery.)

One of the ~5 key points Sowell makes is indeed that preferential policies are economically inefficient. But I’d be damned if he even tried to prove that. When it comes to a country like Malaysia, with a phenomenal economic record, Sowell has to scratch down as far as the earth’s core to find bad things to say.

The 5 key points Sowell makes can be summarised as follows:

Scope & coverage: Preferential policies are intended to be short in duration and restricted in coverage, but they continuously expand in coverage and become practically permanent in duration.

Unintended beneficiaries: The benefits of preferential policies accrue to the most fortunate of the preferred groups, leaving the least fortunate largely untouched.

Intergroup disparities: Ethnic and other intergroup disparities in economic achievement, educational performance and professional membership are normal all around the world and are not, per se, evidence of unjust discrimination.

Intergroup hostility: Preferential policies induce intergroup resentment, both between different preferred groups, and between preferred and nonpreferred groups; resentments are typically occasioned by relatively small preferments; these resentments can lead to violence

Even Sowell suggests (in the Nigeria chapter) that demands for preferential policies may be an inherent part of a society deeply fragmented by ethnic, religious or other divisions. If he believes that, why does he bring up a country like Nigeria or Sri Lanka at all?

( When you stop seeing the Sri Lankan conflict as a case study in ‘affirmative action’, and start seeing the roots of the conflict for what they are ‘- the obstinacy of the ruling ethnoreligious majority in acceding to the biculturalist and bilingualist demands of the ethnoreligious minority, i.e., the exact opposite of Canada and Quebec -‘ then you start realising the irony of an American conservative like Sowell writing about the effects of a unilingual, unicultural policy by the Sinhalese. Another irony is that Sowell’s chapter on Sri Lanka almost reads like blaming ‘affirmative action’ for Tamil terrorism [which includes 1000+ incidents of suicide bombing]. It’s incongruous to see a right-winger cite, even implicitly, …..grievances!…. to explain terrorism! )

I would say: ‘chauvinistic’ preferences + an ethnic spoils system can be compared with American-style ‘compensatory’ preferences along the following dimensions:

efficiency/incentives: whether the system harms economic efficiency and dulls the incentives to work, study, perform, etc. (The point would be to ask, isn’t meritocracy better at creating a successful economy?)

whether intergroup disparities result from discrimination or oppression or other unfair advantages in the past

I don’t think they are really comparable along any other dimension. For example, if a government does not in the least care about filling university places or government jobs with qualified students or employees from the poor and wretched of the preferred group, and only cares about filling them with members of a certain ethnic or other group because the spoils system or the ethnnic/racial hegemony dictates it, then clearly the institutions are not even designed to do their best to find the most qualified or the most disadvantaged from amongst the preferred group. It would then be unsurprising and trivial to find that the beneficiaries of preferments may not be high-quality or poor. With American ‘affirmative action’ or India’s reservations system, there is at least a pretence, and usually genuine good-faith efforts, to find the most qualified and the most disadvantaged from amongst the preferred group even under lower standards. That is why it’s so salient to ask whether the practise of affirmative action by elite universities etc. meets those expectations/intentions.

The same thing can be said about ‘scope & coverage’. Ethnic spoils systems and ethnic hegemonies are not meant to be temporary, as affirmative action is claimed to be. So whether the former are in practise permanent is completely irrelevant.

When it comes to intergroup hostility, it is possible to compare an ethnic spoils system with affirmative action, because usually spoils systems are thought to be dirty, venal compromises that keep the peace. But if the preference system is based on a sentiment such as, “Fuck you, this is my homeland, my land, you interloper pieces of turd lodged up your mother’s arse. This true son of the soil will take the first slots no matter how smart and enterprising you are, and if you don’t like it, get the fuck out”, then nothing is being designed to promote intergroup harmony. (No one asks whether a Ferrari is fuel-efficient, even though you can pointlessly compare its fuel efficiency with that of a Honda hybrid.) Besides, such a system is almost certainly accompanied by other invidious features besides preferences (as they indeed are in several of Sowell’s cases).

It’s part of an argument that Berar was coerced to become a monocultural producer of cotton, which subjected the region to massive food insecurity.

The source of Beckert’s information (footnote 42) is Satya’s Cotton & Famine in Berar 1850-1900. But if you look at page 184 of Satya, the data in Table 25 say the total cultivated acreage in Berar more than doubled between 1860 and 1880 (from ~3 million to ~6.7 million) during the period Beckert is talking about. Percentage of the land devoted to cotton cultivation rose from 21% to 26%.

I think what Beckert does in the passage above is pretty much the stereotype of “lying with statistics”.

{ I started writing this book review, but I never finished, because I was distracted by other things. }

Jerry Hough and Robin Grier have written a pro-capitalist version of Karl Polanyi’s classic The Great Transformation and called it The Long Process of Development. I exaggerate to make a point: both books are about the transformation of mentalities during the process of creating a modern market economy.

Those who read the review by Dietz Vollrath or even Grier’s own description of the book might not have gotten that impression. And indeed most of the Hough-Grier book is actually an informal analytic narrative of the history of state building in England, Spain, the United States, and Mexico. Its overarching point is that economic development, or rather the ‘right’ institutions which promote it, take a really long time to evolve.

In the Hough-Grier view, contemporary problems of development derive from shallow experience of (large-scale) formal markets and Weberian bureaucracy. This lack of practise itself is due, ultimately, to the underdevelopment (or late development) of state capacity. Development takes time and pain, because the norms and values which had served people well for thousands of years take a long time to change.

But the interaction of state formation and informal institutions — norms, values, customs, etc. aka ‘culture’ — is a key component of their argument about why economic development is slow and painful. In short, Hough & Grier argue economic development is a kind of collective action problem in getting people to abide by the rule of law, and this is resolved, in part, when people’s values change.

That “cultural evolution” aspect is what I focus on below.

Hough & Grier start from the premise that “building an effective state [is] a pre-condition for building an effective market”. But it requires a long time just to get to that basic stage where the government achieves, in the words ofDouglass North, a “predominance of military force and the ability to tax within the territory it controlled”.

H & G thus divide the process of state-building into four rough quasi-Rostovian stages of political growth:

Pre-nation-state of roving bandits

Early state with many stationary bandits but one nominal chief

Minimally effective state with one stationary bandit in overall control

Each of these “stages” is accompanied by its own collective action problems. It took many turbulent centuries in England; the authors argue that Spain, though starting from initial conditions similar to England’s, fell behind by at least two centuries; and the Anglo-Spanish disparity was “inevitably reflected in the effective or ineffective governance from which [their New World colonies] learned how to rule”.

{ H & G consistently argue that the centralising state helps develop a national market. But they tend to focus on the control of violence as well as the revenue-collecting efforts of early states, especially in how state finance and commercial policy in British and Spanish colonies are connected. They don’t much dwell on the other obvious way in which state development promotes the growth of a market system — national integration. By contrast, Regina Grafe, in Distant Tyranny, overwhelmingly focused on that element: mediaeval local jurisdictions, internal trade barriers, national infrastructure, the enforcement of national laws, etc. The centralisation of the English state largely coincided with eliminating those things, in contrast with Spain where the state was slower to centralise and consolidate. Traditional neo-institutional analysis has also propounded the market-enhancing effects of abolishing inefficient institutions — e.g., serfdom, usury & just price laws, guilds, common lands, etc. }

But people’s values must also change. Taking their cue from Douglass North, H & G argue it is not enough that laws are enforced through reward and punishment in order for a society to function. The “spontaneous market of Friedrich Hayek is impossible unless self-interest is restrained” by a prior ethical willingness to abide by the rules of the game, and therefore the rule of law must be ‘internalised’ in a people’s consciousness. (I call this the “it’s the utility function, stupid!” argument.)

“…mankind from its earliest days had a set of norms and values that severely restrained self-interest – but values and norms that were optimal for the survival of small family-based tribal units and then villages. These norms emphasized behavior based on personalistic (especially family- and clan-oriented) restraints, reward by ascribed social position, and decisions based on tradition. People were not supposed to treat strangers in the same way that they did insiders. These norms do not restrain self-interest in the ways needed in a modern economy.”

Attitudes which reserve moral self-restraint for insiders but regard outsiders as worthy objects of cheating (or killing) cannot sustain an economy with a complex division of labour, distant markets, impersonal exchange, and large organisations composed of non-kin. Thus, relations with strangers must be governed by “rational-legal” values of impartiality, merit, and equal treatment. Or stated differently: the circle of ‘insiders’ must expand from the family, clan, or village to the level of the nation.

Many of the sociopolitical problems in developing countries — revolutions and radical political ideologies — are attributed to the clash of village and urban values.

The peasants with the traditional values of the village often react with anxiety, fear, and outright hostility to the “satanic” values of the educated elites they meet when they come to the city

And their cultural values range in a continuum from clannish norms with, say, Afghanistan at one extreme to ‘universalistic’ norms perhaps exemplified by Denmark. This is why developing countries cannot be expected to snap their fingers and conjure up ‘Danish’ institutions. It takes time and patience.

But how does the value change happen ? H & G essentially argue an effective state co-evolves with a “capitalist culture”. Their idea, translated into jargon, might be rephrased as: “market-enhancing investment in legal and fiscal capacity crowds in pro-market norms”.

In the absence of a modern administration the early weak state resorts to what ever second- and third-best measures are at hand in governing its territories, such as private tax farmers, or pirates serving as your navy, or merchants who double as customs officials. Over time, through trial-and-error, the state gains more ability to collect tax, enforce its laws, and professionalise its administration. At the same time, with more and more market development, the population at large is forced to undergo a slow, often painful, transition from the “personalistic values of the village” to the “impersonal values needed for a market economy”.

What eventually emerges is a legal-commercial culture where people learn to abide by formal rules that apply to everyone. The state “inculcates rational-legal values” as a concomitant of creating modern markets and administration. Douglass North and Max Weber go on a date, with Mancur Olson acting as the matchmaker.

Their thesis is best illustrated by a crowding-out example: Spanish commercial policy in the Americas inadvertently created a smuggling economy and retarded the development of a legal-capitalist culture.

Nowhere is this argument more patent than in the contrast drawn by H & G between the different evolutions of the English and Spanish colonies in the Americas. Despite its convoluted mercantilist trading system, England permitted free trade in the so-called “non-enumerated” goods. The English mainland colonies developed commercial links with the British Caribbean which generated all kinds of felicitous downstream effects in North America’s market economy.

By contrast, Hapsburg Spain’s single-minded focus on taxing silver discouraged official trade and encouraged smuggling. Thus the Spanish Americas developed a smuggling culture, and not a legal-commercial culture. The Bourbon kings began reversing this policy, but it was too late, especially with the disruption of the Revolutionary & Napoleonic Wars and the independence of the Latin American states.

A concrete example. England, having developed a “minimally effective state” under the Tudors, , had developed the ability to levy taxes in the realm and empire, secure enough to encourage trade in all kinds of commodities to, from, and between the colonies. This not only promoted economic development, but also led to even more tax revenue for the Crown. By contrast, the Hapsburg kings of Spain focused on getting a cut of the silver production in the Americas. Although they became quite good at taxing it at the point of origin, H & G argue they should have invested that “income from silver into building a fleet to defend and expand [their] source of income in the New World”. That fleet could have carried European consumer goods to the Spanish colonies and returned to Spain with agricultural commodities like sugar or indigo for reexport to the rest of Europe. But without that maritime infrastructure, the Spanish colonies could not develop commodity production before the 18th century, as the British and French colonies in the Caribbean had done. The Spanish colonies therefore turned to non-official trade (i.e., smuggling): they shipped silver to Europe and the English colonies. They sent silver bypassing Spain’s watchful eye and taxing ability. The Hapsburgs did not make this market-enhancing investment in fiscal capacity because they spent the silver income on wars in Europe.

Hough & Grier :

Mexico had developed a market economy based on illegal smuggling, which should have produced a strong entrepreneurial spirit and a good understanding of market trade, at least inside the colony. A smuggling economy did not, however, have a growing system of laws, rules, and regulations that were enforced in the judicial system.

As North said, it is important to have property rights that are internalized in people’s consciousness and unconsciousness, embodied in multi-volume codes of laws and regulations, and enforced by impartial courts and professional bureaucracies. Mexico did not have such a structure because of its smugglers’ economy.

In particular, the development of Cuba as a major sugar producer in the 1800s should have developed commerce in Mexico as the English production of sugar in the Caribbean did in New England. A half-century of free trade would have developed a more deeply rooted legal commercial culture.

Of course that’s not all they say about Mexico: they put tremendous emphasis on the long period of disorder following Mexico’s independence where the “cultural evolution” aspect also emerges.

In his “structural demographic theory”, rising inequality, rising elite competition/fragmentation, and rising sociopolitical instability are linked. But elite competition is key to driving the instability.

But Turchin’s concept of elite competition/fragmentation is too narrowly restricted to the political theatre. I am not denying there is more political polarisation today, but he exaggerates the importance of political competition in modern society. Plutocratic or oligarchical cooperation in general is by far the more important story.

Turchin’s model of elite competition is drawn from static agrarian societies where acquiring land and seeking office were basically the only avenues to achieving status. Wealth and the supply of status were more or less fixed. He even views modern societies through this prism, as though the Roman cursus honorum or the Chinese exam system for mandarins were the appropriate analytical lens for interpreting elite social dynamics today.

Also, Turchin would have us believe that the subjective value of status positions for the status holders is purely ordinal — what they care about is mostly getting ahead of others, so elite aspirants are always competing to get to the Nth place when they are at (N-1)th, and this is an important cause of sociopolitical instability.

But the supply of status positions in modern society is not fixed. It grows every year. And the assumption that the value of status positions is purely ordinal is not supported by any evidence.

Traditional Agrarian Society

In a traditional agrarian society, elite wealth was based on land — more specifically, on extracting a fraction of the output of the commoners working the land. When there was a demographic crisis — which is to say, when the land-labour ratio fell and immiseration set in — elite incomes also fell. And the elites sought to maintain their lifestyles by increasing the rate of extraction. But squeezing peasants even more when there’s already a demographic crisis only exacerbates popular immiseration, and there’s a vicious cycle. At some point the only way for elites to even to just preserve their incomes was at the expense of other elites. Thus you have elite fragmentation and internecine competition.

And thus sociopolitical instability and recurring state breakdown. It makes a lot of sense. This model fits many historical cases, as shown in Turchin’s Secular Cycles, one of my favourite books of quantitative history.

However, the intra-elite competition theory does not make sense in modern industrial societies.

(1) Wealth is no longer fixed in the long run. Modern economies reliably grow at 1-2% rates per year. Much of that growth is concentrated at the top, even when measured income inequality is relatively low. So the competitive pressure within elites is much less than in any agrarian society governed by Malthusian-Ricardian-Brennerian-Goldstone-Turchin cycles.

(2) Besides, in a modern society, you need more intra-elite cooperation in order to…

increase economic inequality;

for the elites to capture a greater share of the economic growth;

for capitalists to reduce the bargaining power of labour; and

in order for elites to capture the state.

Anti-competitive practises — collusion, mergers, monopolies, trusts, and other ways of reducing competition and concentrating power in the supply of goods and the demand for labour — are all acts of elite cooperation.

Capitalists are, right now, in unprecedented unity. They agree on policies that matter to them much more than disagree. That unity is necessary to generate the inequality in the first place.

Turchin frequently cites the work of Martin Gilens, who has shown that public policies largely reflect the preferences of the very richest of US society. That’s not elite competition. That’s elite cooperation in capturing the political process. The margin of disagreement on trade, taxes, regulation, etc. is quite narrow. Goldman Sachs has access to the Treasury department whether the party in power is Republican or Democratic.

Therefore, state capture and rent-seeking are now cooperative: conspiracies to rig the rules and increase markups against the public interest require collusion. Owners of one mobile telephony operator don’t have to clash with the owners of another mobile telephony operator: they can band together to lobby the government. Compared with the rise of monopoly concentration, narrowly political elites wrangling over Trump or Brexit is a sideshow.

Almost everybody who is concerned about rising inequality implicitly recognises this: from Krugman to Stiglitz to Milanovic to even Turchin’s friends at Evonomics, they have argued that inequality stems in great measure from anti-competitive practises.

It’s contradictory to bemoan the spread of the ‘neoliberal’ ethos, and simultaneously talk about elite fragmentation. The evidence Turchin marshals for elite fragmentation is basically the distribution of professional salaries and indices of political polarisation. He ignores the much wider evidence of capitalist unity and concentration in support of ‘neoliberal’ policies.

The supply of status positions is highly elastic

Turchin has complained that I look at everything too much in terms of money. But it’s the same story even if I looked at the big picture in terms of social status. Anyone who is rich in the USA can buy status through fame and conspicuous consumption. Who has more status in US society? Justin Bieber with 30 million Twitter followers, or the senior senator from Nebraska?

Turchin’s model of elites is based on agrarian societies where social status is conferred by the fixed number of state offices and in the size of the parcels of land allotted to them.

In modern societies, the supply of status positions is not fixed. Elites have many avenues to acquire status. A good approximation is that the “amount of status” is proportionate to economic growth.

Likewise, PT uses rising annual tuition at Yale expressed in terms of manufacturing worker annual wage as a major indicator of rising intra-elite competition for a limited number of status positions. But the problem is, (a) average tuition at universities has risen in general over the same time; and (b) the supply of universities has actually grown. Which makes my point: the supply of status positions grows!

If an aspirant lawyer fails to get into law school, he can go get an MBA. MBA mills have grown faster than the supply of places at law schools and medical schools, where entry into those professions is restricted by the legal and medical cartels.

On Twitter, Peter Turchin mentioned “There are only 500 CEO positions in Fortune 500 companies”. But there’s also the Fortune 1000 — the market capitalisation of the 1000th company is $17 billion! https://finance.yahoo.com/quote/MMP?p=MMP The median capitalisation of the Wilshire 5000 and Russell 2000 is $530 million and $253 million, respectively. Equivalent numbers in real terms were much smaller 20 years ago.

Another thing: rising inequality within the top income decile is not evidence of rising intra-elite competition. To use that as evidence is to assume a conclusion. According to Saez & Zucman, the real growth rate of wealth per family in the top 1% was 3.4% per year in 1986-2012 — and it is probably higher for the top 0.1%. For the top 10% the equivalent figure is 2.5% per year. This would have been impossible during “structural demographic crises” in pre-industrial societies. Why interpret this as competition, rather than a kind of spoils system in which there is a pecking order of benefits?

The economic pie for the elite is huge and it keeps expanding. There’s enough to go around and there’s no need to fight to the death over resources or status.

Political competition is a small part of elite social dynamics

Peter Turchin is predicting some kind of crisis in 2020 or 2024 on the basis of American “secular cycles” — the cyclical movements of inequality and instability in US history. But even in his own analysis the USA has only 2 full cycles — that’s 2 observations — and that’s not enough cycles (and one of those cycles bestrode the Civil War period).

Which is why PT appeals to the longer history going back to Rome for “more cycles”.

And that is why I keep saying elite social dynamics are different today than for traditional societies. Competing for offices does not have the same importance or salience for modern elites, as it did for elites in traditional societies. The “cursus honorum” is only one way out of many in modern society in which elite aspirants satisfy the craving for status.

I would certainly agree that if economic growth were zero or negative, PT’s elite competition theory might make more sense. Which is why I think SD theory is still quite applicable to many contemporary developing countries, such as those in the Arab world. Also, the collapse into civil wars in many African countries in the 1980s and 1990s was preceded by a large expansion of educated people at the same time economic growth more or less came to a halt.

Some evidence on greater market power of firms and monopoly concentration in the US economy:

The idea of elites being united against commoners does not check out. You commit the classic Marxian type error of thinking of classes of people as if they were individuals. If elites collectively get a larger share of the pie than the commoners, i.e. if all the elites are getting richer, then none of the elites gets personally higher social status between other elites from that wealth. And social status is what really matters. Beyond the level of comfort, wealth is always used to buy status. Showing off luxuries or stuff like that.

No, in reality everybody is competing with those directly above, below and near them. To be rich is to earn more than your wife’s brother. On the individual level, elites always compete because everybody always competes, no matter if they are divided or united.

When elites are united, it means society is united, because elites control society, thus you have a cohesive, high asabiya society, something like strong patriotism. In such a situation social status is gained by signalling caring about the common good. Thus elites will do things like fighting heroically in wars, or donate to the poor or to public works. It is generally better for commoners.

When elites are divided, society is divided. There is an Us vs. Them. Society is always divided vertially, not horizontally, see Gaetano Mosca. It is never proletarians fighting capitalists vertially, it is one set of elites (intellectuals, bureaucrats) leading one set of commoners (proletarians) vs. another set of elites (capitalists, priests) leading another set of commoners (religious peasants), see Russian or Spanish Civil War. Similary, Roman Populists were led by defecting elites like Clodius.

When elites are divided, there is either a cold or a hot civil war. Now, war does have the tendency to exploit. It is never good business for peasant. Even in a cold civil war elite groups have a strong incentive to exploit commoners for resources to be used in the fighting.

(This is not a blog post. I have simply collected the comments I posted at Turchin’s blog.)

PETER TURCHIN & SOCIOPOLITICAL INSTABILITY

If you had to parody Turchin’s prediction for the coming crisis in the USA, it could be like this: the rising trend in Yale tuition, lawyers’ salaries, and political polarisation coincides with an uptick in rampage killings. There will be trouble in 2020 or 2024.

Turchin’s demographic-structural theory argues that the rising trend of inequality and elite fragmentation coincides with an uptick in sociopolitical instability. The trend toward violence and social dissolution is a key prediction of this theory.

So here’s some perpsective.

In Peter Turchin’s database on the “dynamics of sociopolitical instability”, there are ~250 “instability events” between 1980 and 2010. Of these, 174 were “rampage killings”.

(‘Rampages’ are included in the category ‘terrorism’.)

Before 1980, spikes in violence were due to lynchings and riots. But after 1980, it’s dominated by these “rampage killings”.

What is a rampage killing? Well, some examples from the description field in the database include:

“Two teen-agers were indicted Friday in a December shooting rampage that left six people dead.”

“Gang Lu, a distraught graduate student went on a shooting rampage in two buildings on the University of Iowa campus in Iowa City yesterday, killing four people and critically wounding two others before fatally shooting himself in the head.”

“Jason K. Hamilton, 36, had been drinking at a bar with another man until about 10 p.m. Saturday. Then he went home and fatally shot his wife in the head before setting off for the courthouse carrying two semiautomatic rifles. Around 11:30 p.m., he opened fire at the building, eventually firing some 125 shots at the courthouse and at the people who responded to the scene. The gunman killed a police officer, a church sexton and then himself.”

(This one is classified as ‘political’ rampage)

“Alvin Lee King 3d shot 5 killed 4 in a church”

“Robert Harris, who had been fired from his job at a carwash, killed five people at the carwash.”

“Matthew Colletta, 34, a burly bricklayer, went on a drive-by shooting spree in Queens over the weekend that left one man dead and at least four others injured “

Now, arguably these are not ordinary crimes and they may indicate stress in society. But are they any more an indicator of stress in society than ordinary violent crimes, including homicides and attempted homicides?

And are ‘rampages’ an indicator of “sociopolitical instability” ?

Should we expect a crisis in 2020 or 2024 because there has been an increase in “people going postal” events from ~2 per year to ~7 per year?

Turchin excludes homicides from his index of sociopolitical instability. He has various justifications for doing that, but the trend in homicides (and presumably other violent crimes) is down in the period since 1980. What would his index look like if it included homicides?

My point is simply this: the instability data Turchin uses lack external validation. That is, how do we know those data predict actual political instability, since we only have 2 cycles from the past, and also because the composition of the data change over time? So even if there is civil war in the USA in 2020 or 2024, how do know this was objectively predicted by Turchin’s theory?

If we ask the retrospective question, why did Western liberal capitalism actually triumph, then what Branko Milanovic calls “vulgar Fukuyama triumphalism” supplies the correct answer. Liberal capitalism outproduced and outappealed communism and Third World socialism.
The tête-à-tête Soviet-American global struggle over the Third World — the support of comprador dictators, the interference in elections, the military coups that installed friendly tyrants, the interminable proxy civil wars in, etc. — these were sideshows.

The Ogaden War; Cuban troops in Angola; Vietnam; the 1964 coup in Brazil; the Algerian revolution; North & South Yemen!!!, Central America, Afghanistan!, Malaya!!, Polisario!!!, the Indo-Pakistan wars, Allende, the Greek civil war, the mass murder of hundreds of thousands of PKI by Suharto, UNITA, SWAPO, RENAMO, FRELIMO, FMLN, ERP, MIR, etc., etc. — all grand irrelevances in the scheme of things. At least from a western point of view.
What ever Cold Warriors thought at the time, most — not all — but most developing countries could have disappeared into a black hole 16 galaxies away and it would have made no difference to Western liberal capitalism. (And most of the exceptions were found in the few oil-producing parts of the Middle East.)

George Kennan, the original author of the containment policy, had observed there were “only five centres of industrial and military power in the world which are important to us from the standpoint of national security”, and he meant: the United States, Great Britain, Germany, the Soviet Union, and Japan. That could be modified to Western Europe and (some portion of) East Asia.

If the Cold War in the Third World did matter in some way, it was by inducing the Soviet Union to allocate more of its resources to silly adventurism. It was very expensive for the United States, but military tit-for-tat was relatively even more expensive for the Soviet Union. If the Soviet Union was not financing Cuba, Afghanistan, Vietnam, a dozen insurgencies here and there, and a big Pacific navy, could it have allocated more investment toward agriculture and consumer goods? Maybe it could have increased investment to exploit the poorly exploited energy sector? How much less wheat might it have imported from Canada and Australia in the 1980s, and how much longer could the USSR have survived?

What is the true “Fukuyama vulgarism” ? It’s not the triumphalism of liberal capitalism, which seems bloody obvious. It’s the utopian expectation that the Rest of the World would and could adopt the model.

My point is that most of the violent illiberal means by which the Cold War was waged constituted a waste of life and treasure. They were ineffective and unnecessary. They did not matter in the end. Decision-makers at the time may have rationally thought differently, but in retrospect it appears to be true. How can anyone disagree? Was the American war in Vietnam or the Soviet war in Afghanistan not a big waste of human life and national fortunes?

The history in Polanyi’s Great Transformation can be divided into: (a) anthropological claims about “primitive moral economy” in relatively small-scale societies; and (b) the “peasant mode of production” in larger settled agrarian societies. But the debate over Polanyi is not really over (a) or (b); rather these are used to ask the question: (c) “is capitalism ‘natural’ or an unnatural product of contingent political actions?”. Much debate on Polanyi gets heated precisely because of (c) — e.g., the Blyth-Hejeebu-McCloskey exchange over Polanyi is almost a caricature of (c). Hejeebu-McCloskey suggests people in the long past showed evidence of sensitivity to prices and incentives, so they weren’t really all that different from us, i.e., we could model them neoclassically. There was long-distance trade. etc. etc. Blyth: but capitalism is much more than markets, prices, and incentives!! Capitalism requires the commodification of “fictitious commodities” like labour and land which had previously been (mostly) outside the market! It took state planning and intervention to bring about laissez-faire capitalism!

But those theoretical issues about capitalism and the empirical historical issues are very separate.

It’s now untenable to hold the view, à la Moses Finley, that Rome did not have a market economy. It’s also quite doubtful that enclosures contributed substantially to British labour markets during the industrial revolution.

That still doesn’t resolve the question of the ‘naturalness’ of capitalism.

But, theoretically, are Polanyists and institutionalists (for lack of better words) that far apart? I don’t think so. Neo-Institutionalists say the state builds “market-enhancing institutions”… Neo-Polanyists say the state constructs a “market society”…

Institutionalists say the transition from personal exchange to impersonal markets took a long time and was a gradual evolutionary process. Perhaps Polanyists think of it as a more abrupt, violent process. But institutionalists and Polanyists have similar start and end points !

Typically, neoclassical economists don’t use the word ‘capitalism’. It’s the enemies of capitalism which use that word 🙂 Moreover, there is no “modes of production” thinking. The “feudal mode of production” and the “capitalist mode of production” can be explained within a single (neoclassical) framework. You see this with the large theoretical literature modelling every aspect of traditional moral economies (i.e., gift exchange as a cooperative equilibrium of informal insurance or risk-pooling). Nonetheless neoclassical econ recognises the “moral economy” as a thing — it’s even part of conventional labour economics. Except that it’s modelled as optimising behaviour by individuals.

The daily “wage” for an 800 kg working dray horse is about 37,500 kilocalories (Kander & Warde), which translate into ~9.56 kg of oats/day. That’s probably an underestimate, because that “pay” doesn’t include “benefits”, e.g., “housing”, “healthcare” and free shoes… The London silver price of 1 kg of oats circa 1750 was 0.76g. (Allen et al.) So the daily horse “wage” was 7.3g Ag. According to the same source, the daily “fodder” for unskilled Chinese labourers in 1750 was about 1.5g Ag in the Yangzi delta region, the most developed region of the country with the most extensive river and canal network. The closest substitute for oats in China would have been sorghum, which was also considered something only the most destitute ate. Then the “PPP” Chinese wage would have been equivalent to 3kg of sorghum per day, or approximately 10,000 kilocalories. One person can sustainably produce only 1/10 horsepower. Vaclav Smil also reports that people can “sustain useful power rates of [no] more than 70-100 watts”. The unit labour cost of the horse then is 9.56kg of oat-calories per horsepower ; and for 10 men, 30kg of sorghum per hp.

Noel: “Neither seemed to doubt that the resulting society would be more oppressive and less democratic than what really emerged in the northern United States and Canada.”

It’s perfectly reasonable to say that European settlers in North America (and elsewhere) wanted a democracy only for themselves; and if they had been a demographic minority at the beginning, they would not have extended democratic rights to non-Europeans. That’s the logic of apartheid South Africa. I believe this would have been true in any other Anglo society. And I believe this would have been true for Israel at its founding — if Jews had been a minority in 1948, the State of Israel might not have extended democratic and citizenship rights to the Arabs who remained within the pre-1967 borders. (I don’t want to get into whether the Arabs became a minority through ‘exodus’ or ‘expulsion’.)

Noel: “The latter two arguments unambiguously strengthen Suresh’s overall point, which is that there was nothing inherent in English culture that insured that its settler colonies would become rich and democratic places.”

But Suresh’s last paragraph ignores the implications of his own reasoning that settler living standards would still be very high even with a larger indigenous population. Remember what he did with his exercise. He gave white Americans the same income level as now, but increased the indigenous percentage of the US population, and gave the Native Americans their current income ($18,000). So the average income gets lowered. US GDP per capita is lowered only because, for what ever reason, the indigenous population does not have the same income level as white Americans. You could say exactly the same thing about African-Americans in the opposite direction: if their income were as high as white Americans’, US GDP per capita would be higher than its actual level today.

So the exercise Suresh performs is not an indictment of Anglo institutions as they pertain to Anglos. It may be an indictment of Anglo institutions for being only partially inclusive.

But what if African-Americans or Native-Americans were like Puerto Rico within the USA?

Puerto Rico (a) is today richer than if it had not been acquired by the USA in 1898; but (b) Puerto Rico fails to converge further with the USA due to conditions from the pre-1898 period.

Can we not apply the same reasoning? AA income is lower than the national average because of semi-inclusive institutions, but exactly the same institutions raise the AA income higher than any other institutional arrangements in which African populations live. Likewise, Native Americans’ $18,000 income is higher than anything enjoyed by indigenous people anywhere else in the Western Hemisphere outside North America. You could probably say the same thing about South Africa. European institutions clearly give white South Africans a developed country income. Black South Africans have a much lower income, but still higher than most elsewhere in sub-Saharan Africa.

I don’t think you can conclude, as Suresh does, that “Nothing about European culture [read as institutions] granted contemporary Americans the relative economic comfort they’re celebrating today” — it clearly does for white Americans, but it also does even for minorities.

But of course I am not speaking of equity, fairness, or justice. I am only speaking about the nature of institutions and their economic effects.

I agree that Suresh didn’t follow his own argument to its logical conclusion! And I also agree that the problem with English institutions in the settler context is that they have been exclusive. And I believe that we’re all in agreement that alt-North America would have been far less de

But I don’t believe in the counterfactual in which the exclusive institutions needed for the Naidu scenario produce as much prosperity for the European population, let alone the native Americans. Consider the American south. The institutions there were not conducive for economic growth, and if Maya Sen is to be believed, they had a serious long-term negative impact.

South Africa is another (weaker) example. In 2011, using the private consumption PPP exchange rate from the World Bank, the average white household income was US$72,000 against US$81,000 in the United States. I would argue that South Africa is a worse example, since the white population there is more skewed towards the skilled and wealthy than it would be in Naidu-counterfactual North America, but the point holds regardless.

Noel, I have no doubt that higher (AA or indigenous) income would also be better for white incomes, which is to say, institutions which discriminated against non-Europeans were bad for Europeans too. But that effect must be pretty small compared to the positive effect of European institutions overall. The gap between between the average white household income in South Africa and the USA is on the same order as — maybe smaller than — the gap in GDP/capita between the USA and the UK, France, Germany, Italy, Japan, Canada, or Australia. So the fact that South African whites don’t have the same living standards as the average American could be more about American exceptionalism than about South African institutions. As for the US South — yes southern institutions hindered southern growth. But how much of the low state GDP/capita of the US southern states today is because blacks have lower incomes than whites? In a quick search I didn’t find state median household income broken down by race. but states like Louisiana, Mississippi, and Alabama would surely have higher GDP/capita if African-American residents of those states had the same income as whites (or if the racial composition of those states were more like Connecticut).